As you likely know, in early January, EPA finalized the 2021 Financial Capability Assessment Guidance (FCA) for Clean Act Obligations. Last October, the Water Environment Federation (WEF) sent both individual comments, as well as comments with multiple other organizations in the water utility sector to the Environmental Protection Agency (EPA) on the EPA's proposed 2020 Financial Capability Assessment Guidance (FCA) for Clean Water Act Obligations. The water sector has been advocating to update the FCA for the past two decades, and this update is a product of many years of bipartisan work.

The new document will aid water sector utilities and their communities in developing plans to comply with federally mandated clean water mandates by providing approaches that can more accurately and comprehensively account for the disproportionate impacts of water and wastewater service costs on low-income populations.

WEF supports EPA's approach in making this happen, but also included some suggestions for refinement and clarification in our formal comments. WEF worked with experts and partners, as well as a number of technical committees and the Government Affairs Committee to prepare these comments.
The final guidance is a significant advance over EPA’s existing guidance and should be implemented as soon as practicable. The final guidance provides a new, more transparent way of looking at the impacts of Clean Water Act programs on all ratepayers. The final guidance allows for additional tools for communities to address their obligations, as WEF members remain steadfast on their commitment to improving water quality while providing reliable and affordable water services.

It is also important to note that EPA’s new guidance incorporates key elements from a report developed jointly by WEF, AWWA, and NACWA in 2019 that was shared with EPA. I was proud to serve as WEF’s representative to that working group and the report is the result of a robust and inclusive discussion. The inclusion of new metrics suggested by the report marks an important milestone as EPA pivots away from the narrow elements of the 1997 FCA and looks to incorporate a much broader suite of considerations in the 2021 FCA that better account for the financial burdens a community can bear as it meets expansive and costly federal clean water requirements. It also supports that we must look at all water, wastewater and stormwater services when we consider affordability for our customers.
WEF finds this final guidance to be a considerable improvement over the 1997 version and stands ready to assist EPA in the implementation of this final guidance, as WEF and its members continue to work towards securing the federal funding necessary to help our communities continue to serve its citizens, including those more vulnerable.